Which of the following statements regarding a competitive firm is correct?
a. Because demand is downward sloping, if a firm increases its level of output, the firm will have to charge a lower price to sell the additional output.
b. If a firm raises its price, the firm may be able to increase its total revenue even though it will sell fewer units.
c. By lowering its price below the market price, the firm will benefit from selling more units at the lower price than it could have sold by charging the market price.
d. For all firms, average revenue equals the price of the good.
d
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What is a production possibilities frontier? What do points along the frontier represent? What do points inside and outside the frontier represent?
What will be an ideal response?
Table 10-1 Aggregate Quantity Aggregate Quantity ? Demanded Supplied Price (billions) (billions) Level $3500 $2900 65 3400 3000 75 3350 3150 90 3250 3250 110 3100 3400 130 In Table 10-1, what is the equilibrium level of real output and the equilibrium price?
A. $3,100 real output and a price of 75 B. $3,250 real output and a price of 110 C. $3,350 real output and a price of 90 D. $3,400 real output and a price of 75
A student athlete loves cookies. He receives 200 utils for the first cookie, an additional 160 for the second, an additional 120 for the third, another 80 for the fourth, and another 40 for the fifth. The marginal utility of the fourth cookie is ________ and the total utility of consuming four cookies is ________.
A. 40; 40 B. 80; 560 C. 40; 80 D. 80; 600
If the price of the product produced by labor decreases, the marginal revenue product of labor curve will
A. become more inelastic. B. shift to the left. C. shift to the right. D. be unaffected because productivity of labor has not changed.